For Cable, Old Monopoly Behaviors are Going to Change

Telcos and cable TV companies historically have not generally competed head to head with each other on a facilities basis, though mobile companies quickly moved to facilities-based competition. That is not to say fixed network telcos and cable companies now are unused to competition. They compete with each other, with satellite and mobile companies and sometimes overbuilders (independent ISPs).

But, as a rule, telcos have not overbuilt other telcos and cable companies have not directly confronted each other. The direction, though, clearly is in the direction of growing competition, nationwide, albeit on the basis of “over the top” applications competition, and only partly in terms of physical facilities.

For telcos, mobile services were the big break from the historic monopoly pattern. Now AT&T offers nationwide video service for the first time, using it DirecTV asset. Over time, AT&T and Verizon are likely to compete nationwide, or globally, to an extent, in various areas rel…

No Mystery about Cancelled Google Fiber Installs

If one accepts the logic of building new fiber-to-home (FTTH) facilities on the basis of neighborhood demand--building first where there is the greatest chance of getting a significant customer base--then it makes sense that some potential customers who live in neighborhoods without such critical mass might have to wait for facilities to be built.
Some appear to think there is mystery around what Google Fiber is up to, as reports surface of customers in Kansas City having their install orders cancelled. There might be less mystery than some would think.
Google Fiber has halted expansion, using FTTH. It is just that simple. So potential customers in new areas are not going to get that particular service. That means cancelled orders in areas Google Fiber will not now reach. In some cases, it is possible that even new orders in existing areas might be refused. That tends to happen for a number of logical reasons.
An ISP might have made a decision to switch technology platforms. An ISP mig…

Internet Ecosystem Power Already Has Shifted to App Providers; Net Neutrality Does Not Matter, in That Sense

The arguments for strong forms of network neutrality have assumed that, in the absence of rules barring any levels of consumer internet access other than “best effort,” access providers would exercise market power in ways that would stifle innovation on the part of app and content providers.
Ignoring for the moment the countervailing argument that some apps and services might actually require quality of service mechanisms, or that consumers should have the right to choose such QoS-based services, if they choose, it has never been completely clear that innovation or business success--for any app provider--is fundamentally conditioned by the nature of internet access policies.
The fortunes of competitors to Google, Facebook and others is logically not dependent on access rules that might include optional quality of service mechanisms, but on the end users’ preference for those leading apps, and the ability of those firms to keep innovating.
It never has been so clear to some of us that t…

How Much Churn, Revenue Loss Does Bundling Prevent?

Bundling of consumer services (phone, internet, TV, mobile) has, for several decades, been a foundational strategy in U.S. consumer markets. In simple terms, the strategy has been justified by the need for economies of scope, when economies of scale are dwindling. In other words, if the total number of customers if limited, or falling, one way to boost revenues is to sell more things to the customer base, where in the past it had been able to sell one thing to more accounts.

That is why the term “units sold” now is relevant. It is no longer the number of accounts, but also the number of services sold to each account, that drive revenues.

But bundling now also seems to hinge on “tie in” sales. In the United Kingdom, customers who want to buy internet access on the Openreach platform must also buy voice services. Similarly, to get the best rates, U.S. telco consumers often must buy voice to get internet access. Cable TV customers often find that the price for bundled voice, video and in…

What Will Drive IoT Value? Algorithms or Data?

It remains to be what relative contributions of value will be made in the communications business by internet of things and machine learning (artificial intelligence). Almost by definition, huge arrays of sensors will create lots of data, from lots of connections. But making sense of all that data is where the actual business value will be created.
In that sense, AI is the bigger trend, compared to IoT. It is only illustrative, but some have estimated that, eventually, transistors used by some individual computing devices will vastly outnumber the equivalent number of a single person’s brain cells. It is an inexact comparison, but illustrative.
Some believe that, in the future, it is not algorithms but data stores that will drive value. The thinking, by some, is that algorithms will become commoditized (widely available at lowish cost), while it will be data on human behavior that becomes valuable because it is less commoditized.
That would be a complete inversion of the present patte…

Virgin Media Sets 100 Mbps Minimum Speed

Virgin Media will set 100 Mbps as the minimum consumer internet access speed on its network.
Not so long ago, the UK. government set a speed of 24 Mbps, then 30 Mbps as the minimum standard for a “superfast” service. Now, it has added new terms. “Ultrafast is defined as 100 Mbps by the European Commission.
Ofcom changed its definition of “ultrafast” from 100 Mbps to 300 Mbps.
is to become the first widely-available UK broadband provider to offer ultrafast speeds of 100Mbps and above as standard as it revamps its bundles and launches the Virgin fibre brand.
This move reaffirms Virgin Media’s position as the UK’s ultrafast broadband provider with a top speed of 300Mbps.   As the need for fast, reliable broadband increases a speed of 300Mbps is four times faster than Virgin Media’s main competitors’ top speeds and gives households more bandwidth to stream, game, chat and work all at the same time on multiple connected devices.
Ceilings and floors both are important for analysts, industry e…

Many Mobile Execs Likely Already Understand They Might Not Win Big with 5G

It is probably fair to note that not every mobile operator today sees a clear 5G business model. Probably just as certain: even firms who do see a business model do not have a fully-understood strategy already in place for various models that might exist. Even its biggest supporters might readily agree that 5G is not likely going to be the best network for every important application.
It is not so much that there is confusion about potential 5G business models as there likely is an accurate understanding that incremental revenue opportunities will not be ubiquitous, equally substantial or transformative in every case. In the colloquial, there likely will be 5G winners and losers, with the greatest odds of success lying with the largest tier-one carriers with the biggest internal markets, deepest pockets and other assets that allow them to be significant providers of big internet of things applications and solutions.
MTS in 2016, in its core Russian market, saw slightly negative revenu…